FYR MACEDONIA TAX CARD

Transcription

1 FYR MACEDONIA TAX CARD 2017

2 TAX CARD 2017 FYR MACEDONIA Table of Contents 1. Individuals 1.1 Personal Income Tax Tax Exemptions Deductible Expenses 1.2 Capital Gains Tax 1.3 Social Security Contribution 1.4 Submission of Tax Returns 2. Corporate Taxation 2.1 Corporate Income Tax Non-deductible Expenses Exempt Income 2.2 Capital Gains Tax 2.3 Withholding Taxes 3. Indirect Taxation 3.1 Value Added Tax (VAT) VAT Registration Threshold Rates VAT Periods 3.2 Custom Duties 3.3 Excise Duties 4. Local & Other Taxes 4.1 Property Tax 4.2 Property Transfer Tax 4.3 Inheritance & Gift Taxes 5. Tax Calendar 6. Administrative Penalties 6.1 Individuals 6.2 Companies 2 FYR Macedonia Tax Card 2017 Eurofast

3 I. Individuals 1.1 Personal Income Tax A flat tax rate of 10% on the taxable income is applicable Tax Exemptions A monthly amount of MKD 7,456 is exempt from personal income tax, as personal allowance of individuals receiving salaries. The following categories of incomes are also subject to PIT-exemptions: Individual income type Exemption % Per diems (from employment) Severance payments before retirement (up to 2 average national net salaries) Relief for suffered damages from natural disasters (up to the amount prescribed in the General Collective Agreements) Income for compensating expenses made by use of own vehicle for employer s purposes Income for leasing unfurnished residential apartments or offices Income for leasing furnished residential apartments or offices Income from sale of copyrights / IP rights Interest income from bank deposits (until the date of accession of FYR Macedonia into the EU) Property sale income (if property was sold within 3 years of the date it was purchased) Income from games of chance/gambling if the individual instance income does not exceed MKD 10,000 Capital gains from sale of securities/bonds (under conditions) 30% of the price per liter of gas (max MKD 3,500/mo) 25% 30% 25%-60% depending on type Deductible Expenses Individual income type % Mandatory social security insurance contributions for employment income Investment in assets for expanding activity (for self-employed/sole traders) Recognised expenses incurred by agricultural sole traders (self-employed) with annual income below MKD 300,000 Recognised expenses incurred by agricultural sole traders (self-employed farmers) with annual income between MKD 300,001 and MKD 1,300,000 Recognised expenses incurred during sale of capital or property whole amount 30% of investment amount of recognised expenses 80% of the recognised expenses 30% of recognised expenses 3 FYR Macedonia Tax Card 2017 Eurofast

4 1.2 Capital Gains Capital Gains from the sale of property, securities or shares are taxed with the standard 10% rate, levied on 70% of the gains. 1.3 Social Security Contributions All contributions are mandatory, paid concurrently with net salaries (once a month), payable by the employer on behalf of the employee (deducted from gross salary of the employee). The contributions are levied on the gross salary tax base, with a ceiling amount equal to 6 national average gross salaries and a minimum tax base of 50% of the national average monthly salary. Employers are not required to make additional contributions on top of the gross salaries. Contribution type Rate (% of gross) Pension Fund 18% Health Fund 7.3% Unemployment Fund 1.2% Disability Fund 0.5% TOTAL 27% It is worth noting that non-employment income such as service contract based income, paid by a legal entity to an individual only subject to personal income tax. 1.4 Submission of Tax Returns The deadline for submission of personal income tax return is 15th March of the following year. Individuals who received no income other than employment/pension income are not obliged to submit a tax return. 4 FYR Macedonia Tax Card 2017 Eurofast

5 II. Corporate Taxation 2.1 Corporate Income Tax The applicable corporate income tax rate is flat at 10%. The tax base for corporate income tax is equal to the corporate profit (revenues less expenses) plus unrecognised (non-deductible) expenses and any differences between the company s actual income and reported income Non-deductible Expenses Expenses which are considered to be non-essential for the business activity are non-deductible. These include (but are not limited to): Expense type Non-deductible amount Expenses not related to the ordinary course of business Allowances paid to employees above the legally prescribed amounts Board members expenses/allowances above the legally prescribed amounts Hidden profit distribution payments Representation Donations expenses exceeding 5% of the total annual turnover Sponsorship expenses exceeding 3% of the total annual turnover Loan interest expenses for loans not used for the company s main business activity Insurance premiums paid for board members and employees Penalties and interest for late payments to state authorities Inventory shortages Differences between transfer prices and arm s length prices in transactions between related entities Exempt Income Exempt from payment of corporate income tax are the following categories of companies: Type Companies registered as employers of people with disabilities % Under conditions defined in the Law for Employment of people with Disabilities 5 FYR Macedonia Tax Card 2017 Eurofast

6 Business units located within corrective institutions (such as prisons) Companies located in the technological industrial zones (free zones), during the first 10 years of their operations and under conditions defined in the Law on Technological Industrial Zones 2.2 Capital Gains Capital Gains are treated as ordinary income and subject to the same rules as other types of corporate income. 2.3 Withholding tax Payments made to non-resident companies are subject to a final withholding tax on revenues stated in the table below. Subject to provisions of the applicable double tax treaty with the specific country, lower rates may apply. Revenue type Withholding tax Dividends, interest, royalties, entertainment/sports activities 10% III. Indirect Taxation 3.1 Value Added Tax (VAT) VAT Registration Turnover threshold for mandatory VAT registration MKD 1,000,000/yr Voluntary VAT registration is also possible Rates Standard VAT Rate 18% Reduced VAT rate (food items, computers, computer components, software, thermal solar systems, first sale of residential buildings) 5% VAT Periods All VAT taxpayers are classified as quarterly or monthly VAT payers, with their VAT returns (and payments) due on the 25th of the month following the period in question. 6 FYR Macedonia Tax Card 2017 Eurofast

7 3.2 Customs Duty Customs duties are payable on the import of goods and products to FYR Macedonia. The customs rates are calculated on the basis of the custom value increased by related costs. Reduced or zero rates are applicable for import of goods from certain countries or goods with preferential tariff treatment. 3.3 Excise Duty Passenger vehicles 0-18% Tobacco commodities Alcohol and alcoholic beverages Excise duty on cigarettes: MKD per cigarette; Excise duty on fine cut tobacco and other smoking tobacco: MKD 1,650 per kg. MKD 0-300/litre (depending on type) IV. Local and Other Taxes 4.1 Property tax Property Tax 0.1%-0.2% The property tax is a local tax and it varies between 0.1%- 0.2% depending on the municipality where the property is located. The tax base is the market value of the property, as defined by the municipality s committee based on a prescribed methodology. 4.2 Property Transfer tax Property Transfer Tax 2%-4% A local tax with a variable tax rate between 2%-4% depending on the municipality, typically paid by the property seller. The tax base is the market value of the property. 7 FYR Macedonia Tax Card 2017 Eurofast

8 4.3 Inheritance/Gift tax First degree relatives 0% Second degree relatives 2-3% Third degree relatives or not-related 4-5% The tax base is the market value of the property / gift. The exact tax rate is defined by each municipality. V. Tax Calendar ACTIVITY VAT returns (and payment) for quarterly taxpayers VAT returns (and payment) for monthly taxpayers Monthly MPIN calculation for gross salaries on employer level Monthly gross salary payment (including net and all contributions/taxes) Personal income tax company tax return (for paid salaries and other incomes) Monthly advance payments for calculated corporate income tax Corporate income tax return Annual Financial Statements Individuals personal income tax return DEADLINE 25th of April, July, October, January (for previous quarter) 25th each month for previous month 10th of each month for previous month 15th of each month for previous month 31st of January for the previous year 15th of each month 28th of February for the previous year 28th of February for the previous year if filed in paper; 15th of March if filed electronically 15th of March for the previous year 8 FYR Macedonia Tax Card 2017 Eurofast

9 Administrative Penalties Please note that the below listed fine/penalty amounts are only indicative as that actual fines depend on a complex coefficient-based formula which takes many factors into account. 6.1 Individuals Non-compliance cases Fine/Penalty Non-submission of PIT return EUR 500- EUR 1, Companies Non-compliance cases Delayed submission of VAT return Failure to submit VAT return Delayed submission or failure to submit corporate income tax return Fine/Penalty EUR 1,500 for the company + EUR 500 for the responsible person EUR 2,500 for the company + EUR 1,000 for the responsible person EUR 2,000-3,000 for the company + EUR 500-1,000 for the responsible person 9 FYR Macedonia Tax Card 2017 Eurofast

10 Your Regional Business Advisory Organisation Eurofast has taken all reasonable care to ensure that the information herein contained were accurate on the stated date of publication, however, it disclaims all express and/ or implied warranties with regard to the accuracy of the information contained in the published materials. Eurofast, the authors or the contributors take no responsibility for the consequences of any action taken which resulted upon reliance or, in any way, use of the information herein and shall in no event be held liable for any damages resulting from such reliance or use of the information included in this publication. Reliance upon such information does not form any basis of a contract with readers or users of this publication. The information herein contained may be out of date and readers are advised to verify the information herein by seeking specific professional advice from Eurofast consultants before relying upon it. Material published by Eurofast may not be reproduced without permission. Investors are advised to ask for professional assistance, since this booklet is not intended to be comprehensive. Our Firm will be happy to assist you in any way. Published January 2017